<!DOCTYPE html>
<head lang="en">
  <title>CP1 Reversion</title>
  <meta charset="utf-8">
  <link href="../style.css" rel="stylesheet" type="text/css">
</head>


<body>
  <h1>Indirect investment versus direct investment</h1>

<div class="column side">
  <p>Advantages are mostly for small investors</p>
  <p>Diversification + Economies of scale + Marketability + practical problems solved (Expertise, Access to more options</p>
  Approaches to indirect Investment for property investment
  <ul>
    <li>Pooled property funds (investment trust)
    </li>
    <li>Pooled property funds (unit fund)
    </li>
    <li> buying shares in a property company
    </li>
  </ul>


</div>

<div class="container">
  <div class="column middle" id="pagebutton">
    Advantages
    <div id="content">
      <ul>
        <li>Diversification. Spread of risk is obtained, as vehicles are able to build up a diversified property portfolio, in which the institutional investor can have a share. Indeed, because of the lumpy nature of
                property investment, it may be the only way a small fund can obtain exposure to many sectors.
        </li>
        <li>
          Economies of scale. The vehicle can obtain economies of scale in the management of the company, thus professional management can be obtained, without the institution setting up its own management team.
        </li>
        <li>
          Lower dealing costs, again due to the advantages of economies of scale.
        </li>
        <li>
          Marketability Investments are more readily realisable and divisible, as the shares in the vehicle will be more marketable than the underlying assets.
        </li>
        <li>
          Expertise. Specialist expertise often required (e.g. with regard to different property types and/or different locations)
        </li>
        <li>
          access to properties that would not be available through direct investment (e.g. very large properties, new properties)
        </li>
        <li>
          Easier to value
        </li>
        <li>
          Gearing ->higher potential return
        </li>
      </ul>

    </div>
  </div>

  <div class="column middle" id="pagebutton">
    Disadvantages
    <div id="content">
      <ul>
        <li>Little or no control over the portfolio.
        </li>
        <li>Higher expenses, management charges may be incurred
        </li>
        <li>Tax disadvantage
        </li>
      </ul>
    </div>
  </div>

</div>


<footer>
  <p> Author: Mengke, Lyu</p>

</footer>
</body>
